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Thanks for dropping in for some hopefully great business info and on occasion some hopefully not too sarcastic comments on the state of Business Financing in Canada and what we are doing about it !

In 2004 I founded 7 PARK AVENUE FINANCIAL. At that time I had spent all my working life, at that time - Over 30 years in Commercial credit and lending and Canadian business financing. I believe the commercial lending landscape has drastically changed in Canada. I believe a void exists for business owners and finance managers for companies, large and small who want service, creativity, and alternatives.

Every day we strive to consistently deliver business financing that you feel meets the needs of your business. If you believe as we do that financing solutions and alternatives exist for your firm we want to talk to you. Our purpose is simple: we want to deliver the best business finance solutions for your company.



Showing posts with label startup funding. Show all posts
Showing posts with label startup funding. Show all posts

Wednesday, February 26, 2014

Startup Funding In Canada : Business Start Up Financing Has Changed





Putting A Propeller
On Start Up Financing In Canada








OVERVIEW – Information on startup funding in Canada . Business start up financing has evolved into numerous options that depend on the nature and size of your venture



Startup funding
in Canada provides entrepreneurs with the ' propeller' they need to achieve business start up financing that makes sense for entrepreneurs requiring start up financing that achieves ownership goals. Let's dig in.

As we've suggested in the past typically business owners gravitate to the bank when they are envisioning the capital they need to start their business.

The mission though, should you choose to accept it! is to understand the criteria Canadian chartered banks impose on a new business -they are looking for, unfortunately, firms with track record, cash flows, and acceptable owner equity. That’s a tad difficult when you are in start up mode.

So are there alternatives? Absolutely. It's all about ensuring that you and any prospective lender, alternative or traditional, has the incoming cash flows to make debt or operating commitments positive.

Although many businesses can claim to have started with no cash flow the general consensus is that an owner equity commitment is required.

In Canada our version of the U.S. Small business program is called the 'SBL ' loan. That brings a solid partner to your start up venture - the Canadian government via a guaranteed loan.

If you have reasonable personal credit and at least a minimum of 10% permanent equity in your business you're a solid candidate for a ‘BIL ' loan.

It's critical in start up financing to understand that a traditional (bank) or alternative lender will want to know business owner personal credit history. In Canada the ' magic ' score at a credit bureau to be approved for traditional financing is 650.

A solid business plan and cash flow is also a prerequisite for start up funding. That document will demonstrate to lenders how you will handle suppliers, tackle operational expenses, and handle term and operating obligations.

Because start up businesses don’t have access to all the cash the need financing sources must be considered. They include:

Personal resources
Govt small busines loans ' SBL'
A/R financing
Tax Credit Finance - ' SR&ED'
Start Up Working Capital Cash Flow Term Loans
PO/Supplier Financing


The type of financing you need, as well as the amount, will dictate rate/terms/structure

While interest rates are significantly higher for start up alternative finance they are a substitute for giving up equity so early on in the venture. One of our associates refers to it as ' renting equity', and it's an interesting term.

Private equity firms and ' VC's' will of course take a significant amount of ownership for any investment made - and truth be told most start ups don't remotely qualify for equity start up funding.

Do we have a short list for startup financing? We do, and it would include:

Assessing personal equity

Ensuring you have a solid business plan and cash flow

Consider both alternative and traditional sources of capital

Utilize 3rd part resources such as your accountant/lawyer/ financial advisor / key supplier


Seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who will ensure you know the rules when it comes to achieving start up success in Canada.


Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :



7 Park Avenue Financial = Canadian Start Up Funding Expertise








Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT:
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8


Direct Line
= 416 319 5769

Office
= 905 829 2653


Email
= sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '